Washington Spent $497 Million on Yen in July, New York Fed Shows
The New York Fed's quarterly report shows the US Treasury bought 79.4 billion yen on July 31, 2026, its first yen purchase since 1998. The yen still slid to 160.03 per dollar on November 12.
Washington spent $497 million buying Japanese yen on July 31, 2026, the Federal Reserve Bank of New York disclosed in its quarterly foreign exchange report on November 12. The US Treasury bought 79.4 billion yen, or $497.37 million, in its first yen purchase since 1998.
The yen had fallen to 160.03 per dollar the same day.
The Treasury paid with euros drawn from the Exchange Stabilization Fund, a Treasury reserve pool used for currency operations. Joint US-Japan action was already public in early August. The report adds the exact size, date and funding.
The New York Fed acted only as the Treasury's agent and used none of its own money. On July 30, it ran rate checks for the Treasury, calling dealers for dollar-yen quotes as a warning. The yen rose 2.3% that day.
The Treasury did not simply spend the money. It swapped euros for yen and still holds the yen. Over the quarter, the fund's euro holdings fell from $13.1 billion to $12.6 billion, while yen holdings rose from $5.8 billion to $6.5 billion.
The US purchase was small next to Japan's own effort. Japan's Ministry of Finance used a record 15.4 trillion yen, about $96.47 billion, over three days. The American buy was about 0.5% of that, which makes it chiefly a signal of political support.
A to-do list visible in a photo from a July 31 Camp David cabinet meeting suggested Treasury Secretary Scott Bessent was weighing $5 billion to $10 billion in yen purchases. The report shows only one purchase.
The effect did not last. The dollar fell from about 164 yen to about 155, then climbed back and closed at 159.85 on November 12 after touching a 19-month high.
Washington's likely aim is to protect its own markets. If Japan had to sell US Treasuries to fund its defense of the yen, American bond yields could rise.
Market reaction was muted. Invesco CurrencyShares Japanese Yen Trust (FXY) rose 0.02% to $57.30, and iShares MSCI Japan ETF (EWJ) fell 0.69%. Invesco DB US Dollar Index Bullish Fund (UUP) gained 0.22% to $29.42, just under its 52-week high of $29.44.
The gap between US and Japanese interest rates is driving the currency. Most economists expect the Bank of Japan to raise its rate to 1.5% in December.
